ACIT, ANAND CIRCLE, ANAND, ANAND vs. NATIONAL DAIRY DEVELOPMENT BOARD, ANAND

ITA 756/AHD/2023Status: DisposedITAT Ahmedabad02 May 2025AY 2012-1325 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the applicability of MAT provisions (Section 115JB) to a statutory corporation like NDDB is a debatable issue and not amenable to rectification under Section 154. The Tribunal relied on the Special Bench decision concerning banks and the Delhi High Court decision in Oriental Insurance Co. Ltd., which held that Section 115JB is not applicable to statutory corporations or entities not registered under the Companies Act. The deeming fiction under Section 11 of the Acquisition Act for 'corresponding new banks' was held to be limited to income-tax purposes and not for widening the scope of MAT. Consequently, the additions made by way of rectification orders under Section 154, including MAT liability and disallowance under Section 14A to book profit, were quashed. The appeals filed by the Revenue were dismissed, and the appeal filed by the assessee for AY 2013-14 was allowed.

What were the facts?

The Revenue filed appeals against orders of the CIT(A) concerning rectification and assessment orders for Assessment Years (AYs) 2010-11 to 2013-14. The assessee, National Dairy Development Board (NDDB), is a statutory corporation. For AY 2010-11, the AO passed an assessment order under Section 143(3), later modified by orders giving effect to CIT(A)'s directions. A suo-motu rectification order under Section 154 was passed by the AO, including MAT liability on book profit. Subsequently, the AO passed another rectification order under Section 154, allowing exempt income but adding disallowance under Section 14A to the book profit computation under Section 115JB. The CIT(A) allowed the assessee's appeals against these rectification orders. The Revenue's appeals challenge the CIT(A)'s findings regarding the applicability of Section 115JB and the disallowance under Section 14A.

What were the issues?

1. Whether the applicability of Section 115JB (MAT) to a statutory corporation like NDDB is a debatable issue not amenable to rectification under Section 154? (Assessee's contention: Yes, as held by the Gujarat High Court and the CIT(A). Revenue's contention: No, the AO correctly applied Section 154 as NDDB is a company for MAT purposes). 2. Whether the disallowance under Section 14A is required to be added to the book profit under Section 115JB? (Assessee's contention: No, Section 14A applies only to computation of income under Chapter IV, not Chapter XII-B. Revenue's contention: Yes, it is required to be added as per clause (f) to Explanation 1 of Section 115JB). 3. Whether Section 115JB is applicable to statutory corporations like NDDB, especially considering amendments by the Finance Act, 2012? (Assessee's contention: No, citing Special Bench decision in favour of banks and Delhi High Court in Oriental Insurance Co. Ltd. Revenue's contention: Impliedly yes, as NDDB files returns in the status of a company).

Which sections of the Income-tax Act were involved?

Section 154,Section 143(3),Section 115JB,Section 14A

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Cases cited in this judgment(3)Show list

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IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “B” BENCH Before: DR. BRR Kumar, Vice President And Shri T. R. Senthil Kumar, Judicial Member ITA Nos: 733, 734 & 755/Ahd/2023 Asst Years: 2010-11 & 2011-12 PAN: AABCN2029C ITA Nos: 756 & 757/Ahd/2023 & C.O. Nos: 2 & 3/Ahd/2024

Assessment Year: 2012-13 PAN: AABCN2029C PAN: AABCN2029C I.T.A Nos.733, 734/Ahd/2023 and Ors. A.Ys.2010-11 and Ors. Page No 2 ITA Nos: 1052 & 1059/Ahd/2023

Assessment Year: 2013-14 PAN: AABCN2029C (Appellant) National Dairy Development Board Post Box No. 40 Opp. Jagnath

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